Document Type

Article

Publication Title

The Journal of Legal Studies

Publication Date

1995

ISSN

0047-2530

Page Number

463

Keywords

liability reforms, insurance law, medical malpractice

Disciplines

Insurance Law | Law | Medical Jurisprudence

Abstract

This article examines the effect of the liability reforms on medical malpractice insurance over the 1984-91 period. This is the first study to use data by firm and by state for every firm writing medical malpractice insurance over that time period. The liability reforms increased insurance profitability (that is, decreased the loss ratios), where the main mechanism of influence was through decreasing losses. The quantile regression estimates imply that the greatest effects of liability reform are on the most unprofitable firms and that the effect is not uniform across the entire market. This pattern is consistent with the other principal finding, which is that damages caps appear to be most influential.

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